Prize-bond system in Pakistan
17-6-2004 | IslamWeb
Question:
The Pakistani Government issues prize bonds of Rs.10, Rs.100, Rs.500 and Rs.750/ denomination each. It is up to an individual whether he purchases these bonds of Rs.10, 000/- or Rs.100, 000/-. It is like a currency bill which can be cashed at any bank. The Government promises to return the money at the demand and it is written on the bill.
Every quarter the Government draws the numbers of the winning bills and then a prize is announced like Rs.50, 000/- or Rs.100, 000/- on that particular number which can be claimed by the owner of that bill. The amount may be obtained at presenting the bill at the State Bank of Pakistan.
The prize bond's value remains the same. As I have mentioned above it is like a currency bill but usually is cashed at local banks.
After the draw the other bills do not loose their value and are kept by the owner to wait for another draw and even if it never gets the prize the actual value remains the same. Usually people purchase these prize bonds against their savings and when the bond's number comes in the draw then they are happy to get the prize. Some ullema's say that this mode of business is unislamic.
Answer:
Praise be to Allah, the Lord of the Worlds; and may His blessings and peace be upon our Prophet Muhammad and upon all his Family and Companions.
It is not permissible to buy these prize-bonds as they include interest and gambling at the same time.
The amount that is paid for purchasing bonds is nothing but a loan because no person is giving this amount for business in order to risk making some profit or loss. Thus the prize bonds are in reality a loan with interest. Instead of the government or bank giving interest to every prize-bond holder, the interest accumulate and then a draw is conducted whereby some of the prize-bond holders win and others lose; this is the reality of gambling.
Doctor Ali Saluss says regarding this: "It may be possible that a person with a small loan win thousands of pounds, whereas other person's heavy loans do not get anything. So the first person took his share of interest and the share of a large number of people, whereas the share of the second person is taken by others. Each time, involved people who watch or follow this draw; become happy because of what they had won, or sad for what they had lost, and so on, waiting for another prize-bond draw. Is this not gambling?!"
Please refer to the following fatwa…
Allah knows best.